Corning announces 2Q13 financial performance
Press release, July 31; Alex Wolfgram, DIGITIMES [Wednesday 31 July 2013]
Corning has announced that its core sales in the second quarter of 2013 were US$2 billion, an increase of 11% over the same period of 2012. Net sales (GAAP) for the quarter were US$2 billion.
Core earnings per share were US$0.32, representing a 23% improvement over the second quarter of 2012 and the third consecutive quarter of on-year double-digit growth. GAAP EPS were US$0.43, compared with US$0.31 a year ago, a 39% increase.
In Corning's Display Technologies segment, second-quarter LCD glass price declines were moderate and less than the previous quarter. Additionally, core sales in the segment were US$670 million, a 21% increase compared with a year ago, and stronger than originally anticipated. Total glass volume from Corning's wholly-owned business and Samsung Corning Precision Materials increased by a mid-single digit percentage sequentially and about 20% on an on-year basis. On-year core earnings for the segment increased approximately 11%.
Corning's Specialty Materials segment sales meanwhile grew 17% sequentially to US$301 million, driven by increased sales of Corning Gorilla Glass. Segment core earnings grew by approximately 33% over the previous year on strong Gorilla Glass manufacturing performance.
The company also said its core gross margin in the quarter was 43%, a significant improvement over the second quarter of 2012. Corning ended the quarter with US$5.5 billion in cash and short-term investments. As part of the company's commitment to return value to its shareholders, Corning repurchased about US$242 million in common stock during the second quarter and increased its quarterly dividend payment by 11%.
"We believe Corning will continue to have good sales and earnings growth, driven by our Display Technologies segment's success in moderating LCD glass price declines; our leadership positions and strong customer relationships in all of our segments; and growth from new products," said James B Flaws, vice chairman and CFO.
In the third quarter of the year, Corning expects to achieve its fourth consecutive quarter of on-year earnings growth. The company also anticipates its LCD glass volume should be consistent to up slightly compared with the strong second quarter performance. Corning expects its volumes in the second half to be driven by global retail TV demand, especially for 50-inch or larger LCD TVs. Third quarter LCD glass price declines are anticipated to be moderate, and consistent with the previous quarter.
Moreover, Corning said that its Specialty Materials segment sales are expected to improve about 10% sequentially. Corning recently announced the introduction of Corning Gorilla Glass NBT, a specially designed and strengthened cover glass for touch notebook applications. The company expects sales to begin ramping for this new product in the third quarter. Market research indicates that touch-enabled notebooks represent the next wave of opportunity for cover glass technologies.
"Our strong first-half performance has established a solid foundation for continued growth. We expect excellent retail demand for large-size TVs to allow us to continue our strong LCD glass performance from the first half. We expect sales in our Telecommunications, Environmental and Life Sciences segments to grow as well. And we are very excited about the emerging opportunities for our Gorilla Glass products, especially as touch-enabled notebooks become available in the consumer market. We look forward to introducing other advanced technology applications for Gorilla Glass in the coming months," Flaws concluded.
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